UnitedHealth Group (UNH)

Stock Ownership Guidelines; Hedging Transactions

The Compensation Committee believes that an important corollary of an equity-based incentive program is significant stock ownership by senior executives. Significant stock ownership by senior executives further aligns management’s interests with those of long-term shareholders because it helps motivate executives to maintain and further the long-term return to shareholders. Consistent with this view, in April 2006, the Board of Directors adopted stock ownership guidelines requiring that each

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executive officer beneficially own within three years of the adoption of the policy or his or her election or appointment as an executive officer for the first time, whichever is later, a number of shares of the Company’s common stock with a fair market value equal to or in excess of a specified multiple of the individual’s base salary, as follows:

Stock options and SARs do not count toward satisfaction of the ownership requirements, regardless of their vesting status. The Compensation Committee will review compliance with this requirement on an annual basis. As of the date of this proxy statement, Mr. Anderson meets the ownership requirements. Mr. Hemsley intends to meet the ownership requirements by the date of the annual meeting and the Compensation Committee believes that all other executive officers are making satisfactory progress towards meeting the ownership requirements.

In general, uncovered short sales of shares of our common stock by our executive officers are prohibited by SEC rules. Accordingly, under our insider trading policy, we prohibit short sales of shares of our common stock by our executive officers and discourage all employees, including our named executive officers, from engaging in any hedging transactions relating to our common stock. The policy also requires all employees to consult with our Office of the General Counsel if they intend to engage in any hedging transactions. No executive officer consulted with the Office of the General Counsel regarding hedging transactions in 2006.